1. Copyright © 2003 by Marketspace LLC Mohammed, Fisher, Jaworski, Paddison Internet Marketing, 2 nd Ed Chapter 4 Lecture Slides Customer Experience Exhibits and Tables

2. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Customer Experience — Today’s Objectives To understand how the desired customer experience influences marketing choices Formulating the Marketing Strategy Designing the Customer Experience Designing the Marketing Program Chapter 3 Chapter 4 Chapters 6-14

3. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Chapter 4: Customer Experience Defining the customer experience - the seven elements The “Experience Hierarchy” - stages of customer experience Steps in the process of creating desirable customer experience Case Study: eBay Conclusion

4. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Defining the Customer Experience - the seven elements The “Experience Hierarchy” - stages of customer experience Steps in the process of creating desirable customer experience Case Study: eBay Conclusion Chapter 4: Customer Experience

5. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Supporting Slide 4–A: What is Customer Experience? Customer Experience is a target customer’s perception and interpretation of all the stimuli encountered while interacting with a firm Transaction Competitors Advertising Reviews Hearsay Product Quality HomePage Customer Experience Price Expectations Site Reliability Speed of Delivery Trust

6. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC The Sensory Element The Sensory Element The Reactions to Stimuli Element The Reactions to Stimuli Element The Encounter Element The Encounter Element The Objective Element The Objective Element The Perceived Element The Perceived Element Supporting Slide 4–B: Seven Key Elements of Customer Experience The Cognitive and Emotional Element The Cognitive and Emotional Element The Relative Element The Relative Element Site must meet basic functionality requirements Individuals will note and care about certain aspects of the encounter based on their own unique perceptions The entire customer encounter element includes both process and output measures Customers respond to multiple variables, from the tactical layout of the site to high-level interpretations of the meaning of the brand The customer experience can incorporate all five senses Cognitive responses are thoughtful and evaluative in nature; emotional responses tend to capture moods, attitudes and feelings of the customer Previous, separate experiences can affect a consumer’s reaction to various stimuli during a new experience

7. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Supporting Slide 4–C: Role of Customer Experience Articulating a desired customer experience connects high-level positioning strategy to program-level tactics How we are positioned to win in the market where we will compete What marketing activities we will engage in Desired Customer Experience

8. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Supporting Slide 4–D: Point-Counterpoint: Brand Building vs. Customer Experience Point-Counterpoint

9. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Defining the Customer Experience - the seven elements The “Experience Hierarchy” - stages of customer experience Steps in the process of creating desirable customer experience Case Study: eBay Conclusion Chapter 4: Customer Experience

10. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Exhibit 4–1: Stages of Customer Experience If a Firm Gets This Right…This Is What the Customer Experiences Stage One: Functionality Design and information architecture Deep understanding of customer needs Platform independence Efficient transactions Site is easy to use Quick downloads Intuitive navigation Site reliability Stage Two: Intimacy Warehousing and mining Tailoring of pages and offerings Overlay human interaction Integrated data Personalization Increasing trust Repeated experiences of exceptional value Consistent performance over time Constant innovation and upgrading (incremental or significant) A sense of being “in the know” Consistent experiences Significant benefits relative to other offerings Support of evangelists Acknowledgment of evangelists Desire to take message to the market Community benefits Stage Three: Evangelism Stages The “Experience Hierarchy” outlines the three stages of customer experience, from a user’s first click on a site to the point at which that user experiences site loyalty

11. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Supporting Slide 4–E: Stage 1: Functionality A firm must fulfill certain responsibilities at each stage of customer experience in order to deepen customer involvement Firm Responsibilities Great design and information architecture Deep understanding of customer behavior Platform independence Server transactions Great design and information architecture Deep understanding of customer behavior Platform independence Server transactions Customer Experience Usable site Quick, speedy downloads Easy navigation Reliability Usable site Quick, speedy downloads Easy navigation Reliability Stage 1: “The Site Works Well”

12. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Supporting Slide 4–F: Stage 2: Intimacy Once the functionality hurdle has been met, firms can distinguish themselves by establishing a more individualized connection Firm Responsibilities Warehousing and mining of data Tailoring of pages and offerings Overlay human interaction Integrate data with web page activity Warehousing and mining of data Tailoring of pages and offerings Overlay human interaction Integrate data with web page activity Customer Experience Personalized information Increasing trust Consistent experiences Personalized information Increasing trust Consistent experiences Stage 2: “They Understand Me”

13. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Supporting Slide 4–G: Stage 3: Evangelism Loyal long-term customers serve to bring other target customers into the brand Firm Responsibilities Acknowledge evangelists Support evangelists Acknowledge evangelists Support evangelists Customer Experience Wants to take message to the market Enjoys benefits of community Wants to take message to the market Enjoys benefits of community Stage 3: “I Love to Share the Story”

14. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Exhibit 4–2: Stages of the Customer Experience Over Time

15. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Exhibit 4–3: The Seven Deadly Sins of Customer Experience No search feature. Customers must navigate a company-specified path or consult a site map in order to find what they’re looking for. No indication until checkout that an item is out of stock. Hard-to-find contact information. The absence of phone numbers is especially irritating to customers, even though the company may find it beneficial. No gift certificates or gift shipping options. No shipping information or costs until the end of checkout process. This is one of the top reasons that shopping carts are abandoned. So-called ‘opt-in’ marketing buttons. When check boxes default to settings in the company’s favor, customers have to uncheck them to avoid unwanted marketing messages. No printer-friendly feature. This results in hard-to-read printouts and wasted paper.

16. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Defining the Customer Experience - the seven elements The “Experience Hierarchy” - stages of customer experience Steps in the process of creating desirable customer experience Case Study: eBay Conclusion Chapter 4: Customer Experience

17. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Supporting Slide 4–H: Seven Steps in the Process of Creating a Desirable Customer Experience Highly Leverage the Evangelists Highly Leverage the Evangelists Assess Relative Levels of Hierarchy Assess Relative Levels of Hierarchy Articulate Clear Stages of the Desired Experience Articulate Clear Stages of the Desired Experience Create a Rich Description of the Target Customer Create a Rich Description of the Target Customer Integrate the Online and Offline Experience Integrate the Online and Offline Experience Continuously Monitor and Adjust Continuously Monitor and Adjust Develop Use Case Scenarios for Each Target Segment Develop Use Case Scenarios for Each Target Segment

18. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Exhibit 4–4: REI.com Organizes Around Customer Needs Customers can view products by activity type, equipment type, age/gender, or usage occasion. Search box is prominently displayed. Tab navigation sorts content into intuitive sections. Subnavigation offers additional detail. Third-party recommendations enhance customers’ trust in products.

19. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Exhibit 4–5: Stages of Customer Experience for REI.com StagesGeneric Desired Customer ExperienceWhat REI.com Delivers Functionality Site is usable Easy navigation Quick download Speedy site Reliable Content organized around user needs Easy-to-find gear and activity information Website that rates high on efficiency and fulfillment No crashes and limited downtime Intimacy High trust Consistent experience High personalization Authoritative content and information Kiosks in store link to online channel Exceptional value Consistent with brand message Member discounts and rebates Product returns to store or by mail Adventure travel service Evangelism Takes word to the market Defends the experience Membership advantages E-mail option for sharing information Community message boards Easy access to customer service, including live online help E-mail newsletter Multiple views of products and services Quick, effective communication In-store and local events

20. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Exhibit 4–6: Summary of Steps in Creating Good Customer Experience StepBenefit to CustomerBenefit to Company Company better able to imagine customer motivations Integrate Online and Offline Experience Customer experiences consistency across brand and channels Enhanced overall sales, lessening of perceived channel cannibalization Create Rich Description of Target Customers Develop Use Case Scenarios for Each Target Segment Customer experiences increased attachment to company, greater loyalty and potential for evangelism Articulate Stages of Desired Experience Assess Levels of Hierarchy Leverage the Evangelists Monitor and Adjust Customers perceive that they are of value to the company Customer participation in brand and marketing is rewarded by feeling of belonging and community Major and incremental changes to site diminish barriers to good experience Company better able to anticipate and meet customer needs and expectations Company able to map desired outcomes to product and site deliverables Company able to consider strategies for moving customers along the experience hierarchy Company gains insight into product uses and product development; benefits from viral marketing Online channel’s full potential is leveraged Site designers put themselves in customers’ shoes, which helps create intuitive navigation and ensures usability Brings market research to life Allows shared understanding of customer types

21. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Defining the Customer Experience - the seven elements The “Experience Hierarchy” - stages of customer experience Steps in the process of creating desirable customer experience Case Study: eBay Conclusion Chapter 4: Customer Experience

22. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Exhibit 4–7: Stages of Customer Experience for eBay StagesGeneric Desired Customer Experience for Auctions What eBay Delivers Functionality  Direct message  Clean layout  Quick browsing, searching, and bidding  Straightforward selling  Good market segmentation (by category, region, or special interests)  Reliable  Easy-to-locate items  Easy-to-upload information about selling  Fast auction interactions  Easy-to-understand rules and auction interface  No website crashes and limited downtime  Very efficient access Intimacy  Effective communication  Consistent experience  Trustworthy customer service  Only the necessary level of personalization  Exceptional value  Consumption for leisure  Channel for selling, especially B2C  Active community members  Assistance in brand building  User constantly knows status of auction  Site is consistent across all areas  Quick, effective personalized e-mail responses  Users make “My eBay" their main interface with the site  Enabling transactions is regarded by eBay community as extremely valuable  Businesses use eBay as a distribution channel  Active users in personal and company’s feedback forums  Feedback forum becomes emotion-driven: “I wonder what people are saying about me” Evangelism  Takes word to the market  Defends the experience  Look downs on competitors  Describes eBay as the ultimate experience in terms of great deals and trustworthiness  No need to visit other auction websites for better deals or more variety

23. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Exhibit 4–8: EBay’s Functionality The BasicsEBay’s Score Usability and ease of navigation  Intuitive interface guides both buying and selling process  Logical organizational structure reinforces where you are in the site at all times Speed  Site is light on graphics, making performance quick on dial-up connections  Item searches are extremely fast Reliability  Site can handle 800,000 transactions per minute  Outages, a problem in eBay’s earlier days, have been reduced to a minimum Media accessibility  EBay Anywhere enables access from any wireless device Security  Security keys for payments separate from eBay passwords, adding extra level of protection  Encryption used on all transactions to ensure safe exchanges

24. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Exhibit 4–9: EBay Tailors the User Experience to the Individual User

25. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Exhibit 4–10: EBay Community Resources

26. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Defining the Customer Experience - the seven elements The “Experience Hierarchy” - stages of customer experience Steps in the process of creating desirable customer experience Case Study: eBay Conclusion Chapter 4: Customer Experience

27. Last Updated: 04/10/03 Copyright  2003 by Marketspace LLC Customer Experience — Conclusion Customer experience encompasses a customer’s perception and interpretation of all the stimuli encountered while interacting with a firm The “Experience Hierarchy” is the three stages a customer can pass through as their relationship with the product evolves –Stage One: Experiencing Functionality: “The Site Works” –Stage Two: Experiencing Intimacy: “They Understand Me” –Stage Three: Experiencing Evangelism: “I Love to Share the Story” Designing the ideal customer experience through each of the three stages can assist marketers in making the transition from high level positioning strategy to program level tactics